Japan has suggested a common digital currency with Russia as the regional currency in place of the Russian ruble and the Japanese yen at the long-disputed southern Kuril Islands.

An economic proposal by Tokyo to Moscow can be considered as an attempt to build bridges between the two countries. It includes a number of joint economic projects on the Russian-controlled Kuril Islands and, notably, a new regional joint digital currency.

The Kuril Islands are located in the north-east of Japan and all of the islands currently remain under Russian territorial control. They have been the focus of a decades-long dispute between. In particular, Japan contends that four of the island group’s 56 islands are a part of its territory. To this day, the dispute over the islands remains a significant factor behind the lack of a peace treaty between the two countries since World War II.

With nearly 20,000 inhabitants spread across the islands that stretch from Japan to Russia, the islands’ economy is supported by its flourishing fishing trade. The islands also have rich mineral deposits.

In December, last year, Russia and Japan made a breakthrough with an agreement on joint economic activities in the southern Kuril Islands during Russian President Putin’s visit to Tokyo. The agreement will see the restoration of military cooperation between the two countries alongside the establishment of a unique economic regime in the Kuril Islands in order to put an end to the decades-old stand-off.

As reported by Japanese broadcaster NHK,

The agreement has led to Tokyo proposing a number of joint projects in areas including fisheries and tourism, earlier this month. To stimulate economic development in the region, Japan has also proposed a common regional digital currency in the southern Kuril Islands and Japan’s northern island of Hokkaido, to sweeten its proposal.